Econet Wireless Zimbabwe Limited has approved the demerger of Cassava SmarTech Zimbabwe Limited and its separate listing on the Zimbabwe Stock Exchange (ZSE).
In a statement the telco said the demerger is expected to receive shareholder approval at Econet's AGM (scheduled for 29 November 2018) and should see Cassava Zimbabwe listed by 11 December 2018.
Eddie Chibi, CEO of Cassava Zimbabwe, said the company has evolved from a mobile money transfer service to a diversified 'smartech' business.
Chibi added that the vision for the company has always been that of becoming a fully-fledged smartech business, but a deliberate decision was taken to start with EcoCash, the mobile money platform, before expanding to other areas.
According to the company, EcoCash is the largest mobile payment platform in Zimbabwe and is used by over 80% of the country's adult population.
It sees great untapped potential across all areas in which it has expanded, such as insurance, remittances, ride-hailing, and mobile e-Commerce.
Emilia Chisango, Cassava Zimbabwe's Finance Director, says over the last three years Cassava Zimbabwe has seen its revenue grow by double digit figures, more than doubling in the financial year ended on 28 February 2018, to US$258 million. Over the same period its profit also increased with almost 300% to US$71 million.
The company believes the demerger from Econet "will not only unlock value for shareholders, but operating independently will allow the Cassava Zimbabwe management team greater focus on the implementation of its strategy."
Chisango adds, "The demerger still affords EWZL and Cassava Zimbabwe scope to continue collaborating and expand independently of each other, whilst recognising and exploiting the inherent synergies between them."
After the demerger Cassava will own 100% of EcoCash (Pty) Ltd and Steward Bank Limited, 85% of Econet Life (Pty) Ltd, and 90% of Econet Insurance (Pty) Ltd.